Before You Say “I Do” – The Pros of a Prenuptial Agreement

by: Smith and Howard Wealth Management

With wedding season fast approaching, brides and grooms are beginning to think about gowns, tuxes, receptions and honeymoons. While a wedding should be about romance and beginnings, marriage has an added dimension: business. So, while planning your nuptials, we believe you should also plan for what happens in the event of separation, divorce or death.

A prenuptial agreement is often the most secure way to achieve this in a way that brings each party’s assets and debts immediately into the picture and creates an honest foundation from which to start. And honesty is imperative; without it, the prenup agreement might not be enforceable.

The stigma that only the wealthy party in the marriage has these contracts drafted to protect their assets is undeserved. In a time when people are delaying marriage until their careers are well established and assets have been accumulated, and when the divorce rate is over 50%, it is a prudent step to take for both parties. Typically, people have a very negative connotation with the word “prenup”; viewed and discussed for what they are intended to achieve, the purpose should be completely positive.

I actually had one friend argue, “A prenuptial agreement is the most romantic thing you can ask for, since it entirely takes money out of the equation.” Whether people agree with her, is something else altogether. But it is a viewpoint to consider.

Who should have a prenuptial agreement?

  • Those entering a marriage with substantial assets
  • Those with a substantial amount of debt
  • Those who anticipate an inheritance
  • Those who make significantly more than the other party
  • Those that own a business
  • Those with children from a previous marriage to protect the children and make sure some assets are left for them
  • Those who wish to spell out financial responsibilities within the marriage


  • Many states have their own rules regarding prenuptials, cohabitations and common law marriages and can usually ultimately decide how your assets may be distributed upon your death.
  • Each party should have their own counsel to ensure representation when drafting the agreement.
  • You cannot set unreasonable parameters, including limiting child support and custody rights. The agreement must be deemed fair when it’s drafted.
  • If one or both parties have assets when they join in marriage, it might be worth considering keeping the assets in their own individual names otherwise a court might assume upon separation or divorce that you intended to split your assets. It also saves the headache of having to split the equity if that time comes, too.

How to approach the subject with your future spouse

Be up front. Mention the topic of prenuptial agreement early on so it’s not a surprise once you reach engagement. Make sure the agreement is drafted in advance, so the court cannot make the case that one party was coerced into the contract prior to the marriage; thus it might not be upheld in court.

Smith and Howard Wealth Management works with our clients to create a complete financial plan, including a detailed outline of all assets, investments and liabilities. We can work with one or both parties to review this information prior to drafting a prenup agreement. Our advisors, in our role as your family CFO, can also connect you with an experienced attorney to walk you through the agreement process. Please call us at 404-874-6244.